Wall Street closes near record highs; precious metals rise - The Economic Times

Major U.S. stock indexes closed near record peaks on Friday, little ⁠changed from the start of a muted post-Christmas trading session, while expectations of Indian markets mirrored global trends with major U.S. stock indexes touching record peaks. Federal Reserve interest rate cuts and safe haven appeal pushed precious metals prices to all-time highs. Public holidays kept markets closed in Australia, Hong Kong and most of Europe, but the bourses that were open pushed towards ending the year in positive territory, with Asian stocks rising to multi-week highs ‌in their trading session ‌earlier. The benchmark S&P 500, ended 0.03% lower than the open in New York, while the blue-chip Dow Jones Industrial Average fell 0.04% and the Nasdaq Composite fell 0.09%. The small dips snapped a three-session rally ‌but left all three higher on the week and still set for double-digit yearly percentage gains. Megacap tech companies have driven the S&P 500 higher in 2025, and investors have been branching out to cyclical sectors including financials and materials, broadening the upswing and leaving the main U.S. indexes set for a third straight year of gains. Data suggesting the U.S. economy is resilient, paired with the possibility that a new central bank chair to replace Jerome Powell could look to cut rates next year, is supporting markets. Recent pressure on AI stocks stemming from concerns over high valuations and profit-sapping capital expenditures has also lessened. Traders watched for a " Santa Claus rally " which is declared if the S&P 500 advances through the last five trading days ‌of the current year and ‍the first two in January. This would be considered a good omen for stocks in 2026 after a volatile ‍year. Geopolitical tensions enhanced the safe-haven appeal of precious metals the day after the U.S. carried ‌out airstrikes against Islamic State militants in northwest Nigeria. Silver hit an all-time high of $77.4 per ounce, on a 167% year-to-date surge, supported by supply deficits and the metal's designation as a U.S. critical mineral. A weaker dollar further burnished dollar-denominated gold's appeal for overseas investors, helping to send the metal to a record $4,549 per ounce. The gold price eased slightly in later trading but stayed 1.08% higher. Soojin Kim, commodities analyst at MUFG, said in a note the rally could continue, supported by "major banks forecasting further gains into 2026, the strength of physical demand and persistent geopolitical and monetary uncertainties". Oil prices settled more than 2% lower, dragged down by the prospect of a global supply glut and possible progress on a Ukraine peace deal. DOLLAR'S DECEMBER BLUES Investors ‍are preparing for 2026 focused on when the U.S. Federal Reserve might cut rates and by how much. Traders are pricing in at least two cuts over the year, but they do not expect the Fed to move before June. The central bank ‍has projected one more ⁠cut next year but divisions among decision makers ⁠has left investors on edge about the policy outlook. Markets are also waiting for President Donald...

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